Indicator Management Helped Dairy Farms Withstand the Crisis

The feed-cost indicator known as RMCA measures the economic efficiency of feeding lactating cows. Its recommended ceiling is 50% of farm revenue, but several properties reached 60% during the dairy crisis.

According to the review, the most efficient farms stayed close to the target. Their results followed changes to herd composition and feed planning that had been made while prices were still low, rather than after the crisis period had ended.

Specialist Irala also identified production and reproduction measures that can signal management problems before they affect the farm’s cash position. Milk output per cow is used to adjust diets and assess productive efficiency. Days in Lactation, or DEL, provides information on reproductive performance, the herd’s production stage and the timing of management actions.

The share of cows currently producing milk was another measure highlighted in the review. Lactating cows, rather than animals in rearing, breeding or the dry period, provide the economic base of the production system.

The recommended proportion of lactating cows is between 50% and 60% of the total herd. The review found that some farms had levels below 35%, a result it linked directly to lower business profitability. Net margin was described as the indicator that brings together the activity’s financial return and should guide decisions on investment, expansion or continuation, while remaining above the farmer’s opportunity cost.

Irala said these measures had moved from being a competitive advantage to becoming a condition for remaining in dairy production. “The producer of the future will have these indicators as permanent management targets. Those who monitor these figures and act quickly when faced with adversity will be better placed to preserve profitability and ensure the sustainability of the business,” he said.